Copper Prices Headed Up for the Long-Term, Experts Say

Despite a fall in the price of copper from last year's high of nearly $7,000 per ton in the spot market, the price is significantly trending up again.

According to the Finanical Times, metals analysts at Citgroup see "very strong fundamentals" for higher copper prices over the long-term. Max Layton, a Macquarie metals analyst in the U.K., said, "The market believes that the copper rally is going to be long-lived," the FT reported ("Cooper Rally Has Longevity, Say Bulls," Aug. 25, 2009).

Chile and Peru -- home base for many LLM students from our program -- are considered especially good locations in which to mine for copper.

From my own perspective it is difficult to see how the price of copper will go down substantially anytime soon, particularly in light of the growing economies in China and India that will need vast amounts of copper to carry out electrification projects. On the other hand, there are many political, environmental, and financial risks that will need to be taken into consideration as cooper becomes an even more sought after mineral. The graduate program features several mining law courses that explore these issues.

Western U.S. States Must Incorporate "Their Best Practices" Into a Regional Transmission Siting Regime, New Report Says

A regional approach to transmission siting "will facilitate the development and transmission of renewable energy to meet the demands of ever-growing western urban areas and to secure robust interconnections with the national transmission grid" according to two western-U.S. based energy experts.

Mark A. Davidson, a partner at the Denver office of Holland & Hart, and James A. Holtkamp, a partner at the Salt Lake City office of Holland & Hart, have prepared a new report "Transmission Siting in the Western United States: Overview and Recommendations Prepared as Information to the Western Interstate Energy Board", which says that "to assure that the necessary infrastructure [to delivery renewable energy to load centers] is developed, the states in the West will need to incorporate their best practices into a regional transmission siting regime."

Today transmission siting regulatory schemes differ from state-to-state. "Current state siting regimes reflect a system largely built to move power within local utility systems and to connect neighboring utilities to increase reliability," the authors write. However, "These regimes were not designed to address interstate and regional transmission siting on the scale required today."

After the report, which was published in mid-August, reviews the transmission siting regulatory requirements in 11 western states including Arizona, California, Colorado, and Washington, Mr. Davidson and Mr. Holtkamp offer eight "best practices" that could underpin a scheme based on regional siting. Among the best practices include:

• A centralized siting agency with jurisdiction over transmission projects proposed by an entity (whether a regulated utility or not)
• A definition of "need" that recognizes the critical public interest in the efficient and reliable transmission of electricity from a diverse generation portfolio in one part of the region to growing load centers in another, even if neither the loads to be served or the generator are located within the same state
• A level regulatory playing playing field that does not favor investor-owned utilities or any other entities to the detriment of other developers of transmission

Anyone interested in the development of renewable energy needs to look closely at transmission-related issues. This report provides an insightful and timely look at what those transmission-related issues are in the western U.S., and then goes on to provide some ideas for how to improve transmission in the West. It should be read by everyone interested in renewable energy since the matters of renewable generation and transmission are inseparable.

Messieurs Davidson and Mr. Holtkamp have carefully prepared an excellent primer and solutions-oriented report on the challenges and opportunities associated with new transmission in the West. Their work should be the basis of a robust and considered discussion about how to improve a state-by-state regulatory system that is simply not up to the task of delivering a 21st century transmission system. These two gentlemen are pointing the way forward. Let's hope the policymakers are listening.

Chinese Firms Moving Towards Corporate Social Responsibility? Maybe, if Only Slightly

The China Beijing Environment Exchange, an emissions trading firm, has registered its first purchase by a Chinese company of carbon emissions credits. Does this mark an important symbolic step in the country's efforts to address climate change? Or is it merely just a footnote from a county that is now a (if not the) the world leader in greenhouse gas emissions?

While it is difficult to tell, to be sure, a recent article in The Economist ("Carbon Markets in China: Verdant?" Aug. 20, 2009) suggests that "the concept of corporate social responsibility is no longer entirely foreign in China." This month a firm called Tianping Auto Insurance purchased emissions credits equivalent to more than 8,000 tons of carbon emissions.

The emission credits were voluntary in the sense that they were not mandated by the Chinese government (and heretofore I had been under the impression that China and the U.S. took very different stances on many environmental issues; the U.S. government yet to establish that a mandatory system is preferable to a voluntary one).

Before anyone gets really excited about this development, it is worth noting that the purchase price for the credits was only $40,000. However, it may suggest that Chinese firms believe that there is good to be achieved from being perceived by the wider public as having "green credentials."

For now what we do know, according to The Economist, is that China will be a major venue for certified emission reduction credits (CERs). Despite the rather small step the Tianping purchase represents, anything China does in terms of addressing climate change is worth bearing in mind. It is likely to have the largest economy in the world in one or two more generations.

U.S. Power Firms Increasingly Investing in Renewables

A recent story in the Financial Times reports that "traditional carbon-intensive power generators are increasingly investing in renewable generation, giving a boost to this growth industry."

The FT piece ("Power Plants Invest in Renewables," Aug. 20, 2009) quotes a range of officials from the power generation and affiliated industries.

Perhaps the most interesting point was made by Branko Terzic, energy sector expert for the consulting firm Deloitte. Mr. Terzic said that when utility companies own renewable generation facilities they can more easily ensure the ability to meet statutory requirements provided by existing law for renewable electricity generation.

U.S. "Next Big Thing" in Solar Development?

In recent years, the U.S. has lagged behind other nations in terms of solar power development. But that may change in the very near future.

A recent article in the Financial Times ("Potential of the Sun Dawns on the U.S.," Aug. 19, 2009) quotes an official at the Underwriters Laboratories energy department who puts it this way: "Most manufacturers around the world see the U.S. as the next big thing for solar."

Additionally, as the FT noted, the clean technology research group Pike Research said recently that by 2014 the U.S. may lead the world in solar energy. Today the U.S. lags behind Germany, Spain, and Japan. Germany has an installed base of 5.3 gigawatts, nearly four times more than the U.S. has. The German sector has been aided by a "feed in tariff," which requires German utilities to purchase all solar energy produced at an above market cost.

U.K. Government Report Says Nuclear Power Should Provide 35-40% of Country's Electricity Beyond 2030

The U.K. government says that from an aspirational perspective, the country should generate 35-40 percent of its electricity by 2030 from nuclear power.

The potential target, set forth in a report, "Energy Security: A National Challenge in a Changing World," commissioned by Prime Minister Gordon Brown, noted that by 2020 the U.K. will import between 45 and 80 percent of its gas.

Malcolm Wicks, member of parliament and the prime minister's special representative on international energy issues, said, "Complete energy Independence is an unrealistic goal, but there is much we can do to insulate ourselves from the risks, in large part by driving climate policies even further, quicker. We must be far smarter with the energy we use and invest in home grown energy sources, such as new nuclear and renewables without delay."

Today the U.K. generates about 15 percent of its electricity from nuclear power.

The opposition Conservative Party cautioned, however, that the government was in effect leading nuclear power firms to seek development subsidies. Shadow energy minister Charles Hendry said, "If you set an aspiration like that, the danger is that the industry will say, 'If you want that, we have to have a subsidy," according to the Financial Times ("Tories Warn on Nuclear Power Plans," Aug. 5, 2009).

For an interesting look at the U.K. Atomic Energy Authority perspective on nuclear power in Britain, click here to see an interview on E&ETV with Lady Barbara Judge, the authority's chair.

National Renewable Energy Laboratory in Golden, Colorado, Installs Two of the Largest Wind Turbines Erected at Lab

Last Friday, the U.S. Department of Energy National Renewable Energy Laboratory (NREL) in Golden, Colorado, which is located about 30 minutes by car from the DU campus, erected two of the largest wind turbines ever erected at NREL. A General Electric 1.5 MW turbine and a Siemens Power Generation 2.3 MW turbine were erected.

The turbines will begin operating later this year. According to NREL, the turbines:

"[W]ill run for years under close observation and elaborate instrumentation. With data from these experiments, researchers will be working with the wind industry to increase turbine performance, improve durability and decrease loads. The new turbines also allow NREL to take a significant step forward in generating its own clean electricity and meeting the Laboratory's aggressive sustainability goals and reduce greenhouse gas emissions for its expanding research campus and support facilities. The new turbines are expected to generate twice as much energy as the NWTC uses. The U.S. Department of Energy (DOE), NREL and Xcel Energy are working to define an agreement that will allow surplus energy to be exported and sold to the local utility grid.

"It's as large as any turbine in North America," said project leader Lee Jay Fingersh about the 2.3 MW machine. "The final design is different than most turbines with a different blade shape. Land-based turbines are getting larger to meet the demand for wind energy. This is the direction of the wind industry and we want to understand the aerodynamics of these new, larger machines."

NREL is the premier wind turbine performance laboratory in the U.S. Beginning in January 2010, professionals from NREL will teach a new course at DU: "Renewable Energy for the 21st Century: Policy, Law, Technology, Markets."